Building Resilience: How Industrial and Logistics Parks Can Withstand Climate Change
When extreme storms and intense heat waves strike, it reminds us that our world is shifting. While we are aware that the earth is collectively a trail of climate changes, did you know that it adversely affects our businesses and infrastructure too?
Working to combat climate change from becoming our new reality is not enough, businesses across all sectors must also adapt to be resilient in the face of it. Industrial supply chains especially face significant challenges from climate risks. These can damage assets and disrupt operations. In 2023, the World Economic Forum identified the failure of firms to adapt to climate change as the second most severe global risk. As climate imperatives become more urgent, these risks will disproportionately impact sectors with low adaptive capacities. This can lead to disruptions in production processes and affect transportation, housing, and healthcare facilities, thereby challenging the financial health and operational stability of companies.
Impact of Climate Change on Industrial and Logistics Parks in India
There are diverse set of climate risks that affect different geographical locations. Spatial data analysed by WRI India’s geo-analytics reveals that coastal states, for instance, are vulnerable to rising sea levels, lightning, and cyclones, while hill states are prone to landslides and flash floods. Additionally, some states face multiple complex risks.
Maharashtra, Tamil Nadu, Karnataka, Gujarat, and Telangana are a few prominent states where most of the country’s industrial activities are concentrated in. These are particularly susceptible to extreme heat, drought, water stress, and groundwater depletion. These can jeopardise the normal functioning of industrial parks in multiple ways. Extreme heat reduces outdoor workers’ safety and productivity as well as disturb machinery performance. Water crisis can not only create water shortages but also inflate water procurement costs which in result impacts water dependent operations in sectors such as manufacturing. Groundwater depletion only adds to the water stresses in the region which cause strain on any operations that rely on abundant water supply.
Clusters along the eastern coast including Chennai, Kanchipuram, Visakhapatnam, and East Singhbhum, which are hubs for the pharma, chemical, and automobile sectors, are prone to a different combination of climate risks such as extreme precipitation, water stress, lightning strikes, and heatwaves. These result in disrupted transport networks and damage to infrastructure due to extreme precipitation, delays in supply chain and operations due to bad weather and floods, and lightening strikes pose massive safety risks for employees and equipment both if not accounted for while planning and designing.
Pune, Bharuch, and Raigad areas face extreme precipitation, heat stress, and meteorological droughts. The potential economic and operational impacts on industrial parks due to this are as varied as they are significant. Additionally, various air quality-related risks affect these clusters and their industrial sectors as well.
Climate Resilient Infrastructure and Design Planning for Industrial and Logistics Parks
The first step in designing climate resilient infrastructure is to integrate a comprehensive climate risk assessment in the initial stages of planning and development itself. Understanding the exact physical risks that the local climate poses to assets is crucial. Spatial data and historic monitoring provide dynamic, detailed risk analyses, which developers and planners can use to make informed decisions.
Choosing the right location is the next step to minimise climate related risks. Areas with lower risk profiles should be identified and prioritised considering factors such as rising sea levels, extreme heat, flooding, and other local climate hazards. Based on the risk exposure, the master plan should incorporate the respective climate resilient infrastructure design features such as elevated building plinths to prevent flood damage and strategically placed green spaces to mitigate heat island effect.
For existing assets, upgrading industrial and logistics parks’ infrastructure should be a vital step for integrating climate resiliency. For example, enhancing stormwater drainage systems can tackle flooding and water damage. Assets can be retrofitted with renewable energy sources such as solar panels to offset fossil fuel reliance and to meet decarbonisation targets—not to mention the cost savings incurred along with the increased climate resiliency. Solutions such as cooling rooftops, water pools and increased tree coverage can further help manage extreme temperatures and mitigate heat waves.
Technology Integration and Operational Strategies for Proactive and Predictive Resiliency
Implementing early warning systems (EWS) is a proactive strategy with which industrial and logistics parks can react promptly to acute climate events if they occur. AI powered EWS can also provide advanced alerts for natural disasters such as storms and floods, allowing industrial and logistics parks to respond timely and minimise the potential disruptions to the supply chains housed within their premises. These systems can also alert to other types of threats like geopolitical disturbances, wars, and cybersecurity risks.
Having clear response plans and contingency strategies in place for each type of alert ensures a better preparedness towards responding to and reducing risks. Digitising the operational management can enhance real-time visibility, allowing for quick communication and adaptive responding to any potential disruptions that occur internally. Quantifying risks helps companies establish their risk tolerance, define thresholds, and optimise risk management strategies by comparing the costs and benefits of different measures to make it realistic and achievable.
Mitigating Climate Change
Obviously, mitigating climate change itself is the most critical step in building industrial and logistics parks with climate resilient infrastructure and supply chain systems. Businesses must actively reduce their carbon footprint, advancing beyond Scope 1 and 2 emissions to even focus on Scope 3 emissions to decrease their overall carbon impact throughout their operations.
By committing to climate change mitigation, companies not only protect their operations but also contribute to broader environmental sustainability.
